Rightways

Saturday, November 26, 2016

Ma'sia's skilled labour shortage, engineers not take up challenges, graduates can't solve problems

More trained workers needed to attract new capital investments

Yap says manufacturers have to source for high-quality technology from places such as Taiwan and Europe to upgrade their production.

THE Malaysian economy can sure use a boost to grow sustainably in the long term because the indicators for long-term growth do not look very good.

That boost should come from a focus on human capital. To put it simply, a better proportion of skilled workers is needed for the economy to move up the value chain and be globally competitive.

This year the economy is expected to grow just over 4% year-on-year, after growing 5% last year and 6% in 2014. The economy is expected to grow by 4% to 5% next year although the headwinds buffeting the Malaysian economy will make it challenging to hit the upper band of the target.

Moving up the chain will mean producing goods and services that have a higher value, meaning that productivity will rise. The rise in productivity will mean that workers will get better wages. This is the basic argument of policymakers when they speak of how human capital can help the economy.

However, the reality is different. According to data from the Malaysian Productivity Corp, the average annual labour productivity growth between 2011 and 2015 was 1.8% while the 11MP has a target of 3.7% annual growth. The doubling in labour productivity growth is needed to hit the high-income target of the New Economic Model.

Malaysian Employers Federation executive director Datuk Shamsuddin Bardan notes that the economy saw a labour productivity growth of 3.3% last year but believes that it will be challenging for labour productivity to grow in the years to come because of the lack of skilled workers.

Shamsuddin: ‘I doubt very much whether our policy emphasising English will be successful, as statistics indicate that if we ask teachers themselves to take SPM English exam, possibly half of them will fail.’

The 11MP targets skilled workers, that is, those with diplomas and higher qualifications, to reach 35% or 5.35 million of total workforce by 2020. Currently 28% of the total workforce of 14.76 million are considered skilled workers.

Shamsuddin fears that without more skilled workers, the economy will find it more difficult to move up the value chain and will not be able to attract large capital investments.

He tells StarBizWeek that the 11MP target is well below the proportion for skilled workers compared to developed economies, where the proportion is at least half of the total workforce.

Shamsuddin says government plans to raise the skill levels of Malaysian workers have so far only shown mixed results, with a gap between the plans and the actual implementation.

Indeed, the Organisation for Economic Cooperation and Development, a grouping of rich economies, says in a 2013 report that the country needs to address long-standing economic weaknesses in the medium term in order to progress toward becoming an advanced economy within the next decade.

“Skill shortages and mismatches and the deficiencies in the education system that underlie them and the low participation of women in the workforce particularly need to be remedied,” it says.

It adds that the talent base of the workforce lags behind the standards of high-income nations. “The country suffers from a shortage of skilled workers, weak productivity growth stemming from a lack of creativity and innovation in the workforce, and an over-reliance on unskilled and low-wage migrant workers,” it adds.

Observers say cheap unskilled foreign labour is the bane of the Malaysian economy. According to the latest official estimates, there are 1.9 million documented foreign workers in the country with the Government having put a cap of the proportion of foreign workers to the total labour force at 15%.

Unofficial estimates of foreign workers, both legal and illegal, could be more than double that with the numbers having a negative effect on total wages.

Socio Economic Research Centre executive director Lee Heng Guie says in the long run, businesses will need to increase automation for the low-value processes in the manufacturing sector in order to reduce their reliance on foreign labour.

“We are not asking everything to be automated as some places you still need labour, but what you want is to gradually move up rather than continue to rely on cheap labour.

“It is not a solution for industries to compete,” he says. There is also a need to review policies in order to identify implementation flaws and weaknesses.

But the work cannot be all one-way. Lee points out that the private sector must come forward to work with the Government to create a sustainable ecosystem for innovation.

While businesses acknowledge the urgency of working efficiently and relying less on foreign workers, they point out that the supporting technology including for automation cannot be found in the country and must be sourced from abroad.

Asia Poly Industrial Sdn Bhd executive director Michael Yap says manufacturers have to source for high-quality technology from places such as Europe and Taiwan to upgrade their production processes. The company, a subsidiary of Bursa-listed Asia Poly Holdings Bhd, is a maker of cast acrylic sheets used to make corporate signages, lighting displays and sanitary ware, has a high proportion of foreign workers in its workforce.

Yap also finds it difficult to get skilled workers or even motivated ones compared to the 1980s and 1990s. He says engineers today are not willing to take up challenges and many graduates cannot solve problems.

His colleagues observe that Malaysians also do not want to work in the manufacturing sector, even if the workplace environment is conducive and they are given opportunities to give their inputs.

Given the increasing importance of the services sector to the economy, Englishlanguage skills are important but again, there is a gap between the plan and the implementation.

The Services Sector Blueprint launched last year targets the sector to make up 56.5% of gross domestic product by 2020.

Shamsuddin says it is critical for the education system to plan for the future requirements of the economy and the command of English is very important to the services sector.

“I doubt very much whether our policy emphasising English will be successful, as statistics indicate that if we ask teachers themselves to take SPM English exam, possibly half of them will fail,” he adds.

Lee feels that a more consistent policy towards English is important, referring to the abrupt change in the teaching of mathematics and science to Bahasa Malaysia after it was taught in English from 1996 to 2012, as a change that has failed Malaysian children.

By ZUNAIRA SAIEED Starbizweek

Related: Liow: Malaysia needs more skilled workers

Reducing reliance on foreign workers

https://youtu.be/eBG7C3xitL4

More engagement needed with industry to avoid labour shortage in certain sectors

PETALING JAYA: The freeze on the hiring of foreign workers from February reveals how reliant Malaysia’s economy is on low-wage labour for growth.

A rough calculation by Malaysian Palm Oil Association chief executive Datuk Makhdzir Mardan showed that in 2013, when the plantation industry had a shortage of 23,500 workers, the opportunity cost came to RM1.6bil. He points out that in 2013, one foreign worker who works as a harvester equalled RM500,000 in productivity.

While the over-arching industrial policy is to produce higher value-added goods and services, the truth is that large segments of the economy is still very much dependent on low-wage labour, particularly of the low-skilled foreign migrant-worker kind.

Migrant workers Manik and Mohammad Delowar, both 27 years old from Bangladesh, are two such workers working on the multibillion ringgit Sungei Buloh-Kajang MRT line. Manik has lived in Malaysia for the last eight years and has worked on three property projects before being employed to work on the MRT project.

Both earn a salary of between RM1,500 and RM1,600 per month, 75% of which is remitted home to support their families. Manik told StarBiz that the freeze, which came about after a public outcry over an agreement between the governments of Bangladesh and Malaysia to supply low-skilled workers, would definitely affect the flow of workers that wanted to work in Malaysia.

“I do not wish to go back to my country as I’ll not be able to find a job there,” he said, adding that unemployment in Bangladesh was high and he had to support a family of six.

Manik paid RM8,000 to an agent and waited a year before securing a job in Malaysia. He sold land and borrowed money in order to pay for the fees. Mohammad, who has been working in Malaysia for eight months, paid RM12,000 in fees.

Their experience tell the often unheard human story of foreign workers in Malaysia. These millions of workers who come from the most part from Bangladesh, Indonesia, Myanmar, Nepal, the Philippines and Vietnam are familiar faces in various sectors of the economy. The construction and agriculture sectors cannot do without them while the services sector, especially the hospitality, food and beverage and security industries, have large numbers of foreign workers.

Although the low-cost model of growth has served Malaysia well in the 1980s and 1990s, it has also made local firms reluctant to adopt technology or more efficient ways of doing things. Malaysia’s membership of the Trans Pacific Partnership makes higher productivity and efficiency ever more urgent.

Economists argue that without a rise in productivity, measured in the production of higher value-added goods and services, wages will continue to be low. The large number of foreign workers with their lower skill sets and low wages makes things worse.

This is not to say that there are no higher value-added goods or services being produced, or that the Government is not encouraging it. The New Economic Model, together with the National Key Economic Areas, have identified various sectors and subsectors in which Malaysia can have a competitive advantage.

Leadership, clear-cut policy on foreign workers and investment in education as well as technology are just some of the issues that come into play as the country strives to reduce its reliance on low-wage workers and move up the value chain.

Master Builders Association Malaysia president Matthew Tee and Makhdzir agree that the adoption of technology and mechanisation will reduce dependence on foreign workers.

Tee said the Government should provide more incentives for construction firms to adopt more efficient processes such as the industrialised building system (IBS) that could reduce dependence on low-skilled migrant workers. He pointed out that reducing the import duties on construction machinery could also help.

Meanwhile, Makhdzir said more funds should be allocated to oil-palm research and development (R&D) to make the industry more competitive. “If we desperately need to make that progress, we need to put in more talent, and more money to make it competitive in terms of R&D,” he added.

Makhdzir said the policy needed to be more flexible where R&D was concerned as talent must be sourced from outside the country if necessary.

But in the meantime, the freeze on foreign workers is causing a lot of problems as news headlines in recent months show. The problem is particularly acute in the construction and agriculture sectors.

Tee said there was a shortage of 1.3 million workers in the construction sector and predicted a shortage of up to 2 million by 2020. “This will cause delay in projects which could result in liquidated damages by clients translating to thousands of ringgit per day,” he adds.

Tee observed that the government-initiated rehiring programme that in part would also legalise illegal foreign workers had only attracted 3% of the 1.7 million total number of illegal workers in the country. He said the requirements to legalise the workers were inflexible and because of that, many did not fit the requirements – one reason why the overwhelming majority had decided not to get properly documented.

He said firms wishing to hire workers under the rehiring programme found it more expensive than hiring fresh foreign workers. On the other hand, Makhzir said there needed to be leadership in tackling the issue while Tee said there needed to be more engagement with industry as the reaction from the authorities had been slow.

By ZUNAIRA SAIEED

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US electoral democracy is failing, enter the China model? 21st century belongs to strivers

Authoritarian regimes and dictators around the world must feel vindicated by the just concluded presidential race in the United States, the one-time champion of liberal democracy that had the habit of exporting if not imposing its political system and the accompanying values to the rest of the world.

It is not so much the final outcome of last week’s race as the entire democratic process that is being questioned or scrutinized in and outside the US.

In the run-up to the Nov. 8 election, spectators of American politics were served with the tale of a contest between two candidates, both with problematic backgrounds and flawed characters.

More negative revelations about the candidates emerged as the election day neared to raise serious questions about their credibility and competency of whoever is elected to lead the world’s most powerful country.

The American media had rightly if not unkindly described this as an election where voters had to choose between the lesser of two evils.

When that choice fell on Donald Trump rather than Hillary Clinton, there was more indignation, both at the outcome as well as the electoral process.

What went wrong with the system, many people asked?

Is the American electoral system failing that we should question its effectiveness and efficiency in picking national leaders? Or are we seeing signs of fatigue in the system that has evolved in the last two centuries? To describe this as a systemic breakdown of the electoral process would probably go too far, and would give pretext for countries to conveniently discard or to forget liberal democracy.

Maybe it is worth recalling that just eight years ago, the same system gave America its first black president in Barack Obama, who was reelected in 2012. This year, the same system almost produced the first US woman president.

Still, the 2016 American presidential race, from the process to the final outcome, gives plenty of ammunition to those who doubt the ability of liberal democracy in producing great leaders.

The timing could not be worse, coming as the US superpower status is waning, through a combination of its own failing strengths and the rise of China challenging America’s supremacy.

Liberal democracy a la America had its strong appeals in recent history that it seemed to be the natural or only course for any nation to go. Theories were postulated about the first wave, second wave and third wave of democracy. There may not be a fourth wave, at least not until nations are convinced that this is really the best way to move forward.

Enter the China model.

Because it is a system that has proven efficient and effective, and certainly delivered the economic goods, it is now being touted as the better option than liberal democracy for developing countries looking for the right kind of nation-building model, including in the way they pick their leaders.

One caveat about the China model, however: Forget freedom and basic rights, the fundamental tenets that underpin liberal democracy.

What matters is that the system brings economic growth and development and raises people’s prosperity. The suppression of some freedoms and rights — big or small is relative — is the price nations have to pay to ensure stability, a prerequisite to development.

Freedoms and basic rights can come later, if at all.

In The China Model — Political Meritocracy and the Limits of Democracy (2015, Princeton University Press), author Daniel A. Bell shows how China introduced a meritocratic system that has produced leaders the nation can be proud of.

The leaders that have come out of this system have consistently produced rapid growth rates that turned China from a large poor developing country to the second-largest economy in the world in these last two decades.

The system still ensures periodic changes of national guards to prevent China from becoming a dictatorship. It offers a degree of predictability to ensure stability, a factor sorely missing in liberal democracies. It is not a perfect system by any measure, but it is a model that has evolved in China out of the socialist system that the founding fathers of the People’s Republic of China launched in 1949.

But if countries are not comfortable with the costs to freedom and basic rights that the China model entails, they should probably take another look at the US democracy, and consider 2016 as an aberration rather than a system that is failing, a system that is suffering from fatigue and needing reforms.

Americans need to look at the role of the political parties and the way they produced presidential candidates. Surely a country of 320 million people deserved better choices than Trump and Clinton. How their track records and flawed characters got past the political screening system is simply baffling.

The US electoral system — including the primaries and the conventions — is simply too long and too expensive for any country to emulate. For that price, Americans should feel they are being shortchanged by the system.

This year’s voter turnout, estimated at 58 percent this year, is another reflection of the growing public apathy toward the electoral system or the candidates it produced.

The 2016 American presidential race saw the ugliest and most divisive campaigns ever seen that inevitably would leave behind a sour taste, even if Clinton gave a gallant concessionary speech.

The US election has become one big and long political show of selecting the most popular, but not necessarily the most capable candidate. One could compare it with American Idol, but even this reality TV show has been pulled out due to viewers’ fatigue.

If this is the picture of democracy, then many nations around the world would want none of it.

The US electoral system actually has built-in self-correcting mechanisms such as the two-term limits and the various institutional checks-and-balances to prevent the emergence of a despot.

The First Amendment, and the independent media, ensure that people will always have the right to speak up and to be heard, even if they have made the wrong choice.

But these may not be enough to restore the faith in liberal democracy in producing great leaders. This faith has further waned after the 2016 US presidential election. One could also throw in Brexit as another product of a democratic exercise in the Western world that has gone wrong.

In many countries, liberal democracy is no longer considered the best political system in selecting national leaders. It is not the only way forward. The China model has never been more attractive alternative in some countries, including Indonesia, still grappling with nation building.

America can help restore faith in liberal democracy by carrying out the necessary electoral reforms. It needs to show once again that democracy is the best political system in selecting leaders because it is based on the principles of respecting freedoms and basic human rights.

Yes, America can be great once again. But probably it would be asking too much from the new elected president.

By Endy Bayuni, Editor-in-chief of The Jakarta Post

Can China overtake US to lead the world?

Trump’s trade tempest

Discussions were running high on global governance among Western public opinion on the eve of the Asia Pacific Economic Cooperation (APEC) leaders meeting in Lima, Peru. Some Western media outlets hold the US is giving up its global leadership following Donald Trump's election as US president on promises to abolish the Trans-Pacific Partnership (TPP) and withdraw from the Paris climate deal. They believe a rising superpower, China, will replace the US to lead the world.

Trump's campaign remarks do reveal his intention to retract US global strategy. He seemingly wants to focus more energy and resources on reviving the US economy and social development. But as the US has been central to globalization, Trump is unlikely to take on the traditional isolationist road.

The West likes to use "leadership" to define the function of a major power. Admittedly, different countries have different powers and obligations due to varied national strength. The world after the Cold War was dominated by US leadership. Washington designed and maintained a string of systems, including the world trade system, the financial system, the Internet system, the security pattern and so on.

The US has invested much into maintaining this leadership and also gained considerable benefits. In the foreseeable future, it's impossible for the US to abandon its global leadership.

The US sought supremacy over everything in the past few years. However, it didn't have enough national strength to bolster this unrealistic goal. Trump appears to be redesigning the US leadership, withdrawing the country from fields in which he thinks resources are being wasted. China thus will gain some room to exert its influence, but is China ready?

China still cannot match the US in terms of comprehensive strength. It has no ability to lead the world in an overall way, plus, neither the world nor China is psychologically ready for it. It's beyond imagination to think that China could replace the US to lead the world.

But as China is rapidly developing, bringing about changes to the global power structure, its participation in global governance will be a natural and gradual process, which Beijing cannot rush or escape.

If Washington withdraws from the Paris climate deal, China can stick to its commitment, yet it won't be able to make up for the loss caused by the US. Or if the US takes on an anti-free trade path, the messy consequences will be beyond China's ability to repair.

But on the other hand, the US, under the leadership of Trump, cannot rope in China's neighboring countries to contain China or isolate China from the world trade system. Obama's administration had worked to undermine China-initiated projects, such as the Asian Infrastructure Investment Bank and the "One Belt and One Road" initiative, but to no avail.

So Sino-US cooperation is the only choice for future global governance. For a long time to come, the leadership of the US will be irreplaceable, meanwhile, China's further rise is inevitable.

- Global Times

Commentary: 21st century belongs to strivers

"The 21st century is the time for the Chinese," said the CEO of a Chinese mobile phone company at the recent launch of a new product. The CEO remarked that Western bigwigs will finally be surpassed by Chinese strivers who are determined to change their lives through hard work.

He further explained that, although some companies in developed countries are leading the world in many aspects, their bureaucracy, laziness, arrogance and ego will hinder their development.

To some extent, all Chinese people in the past 100 years are strivers who have managed to change their own fates and the fate of their country through sheer diligence; this trend is vividly illustrated by the process of reform and opening-up. After keeping their noses to the grindstone despite hardships and difficulties, Chinese people have finally succeeded in ushering in a new era.

Those who have doubted China over the years were not aware of the strivers' true personalities. The strivers desperately thirst for better lives. They are able to bear unbearable hardships and endure unendurable suffering. Such morale and pluck can never be defeated.

The struggle of a software company in Guangdong, which has grown from a small enterprise into an industry titan, offers an inspiring story. During a trip to Germany for an exhibition shortly after the company's founding, both boss and employees slept on park benches in order to save money. More importantly, none of them complained about having to do so.

In 2009, China needed to build a large exhibition area, as the guest of honor of that year’s Frankfurt Book Fair. However, shortly before the opening of the event, construction was not yet complete because of German workers' fixed schedule. Therefore, the Chinese exhibitor invited workers from China to complete the work, and that team was able to finish before the opening ceremony.

It is the effort, hard work and sweat of these strivers that have contributed to China's current development. Their willingness to struggle came from a thirst to change their fate.

In recent years, many Chinese enterprises are expanding their business in Africa. Instead of spending money on entertainment, Chinese employees there save money to make phone calls to their families back home. This priority was not received well by some locals, who believe that one should enjoy life with one’s money. As a result, people cooked up stories that Chinese employees in Africa were prisoners sent by the Chinese government. Believing these rumors, some Western media outlets even slammed China for human rights violations. Finally, a media outlet from the U.K. discovered the truth. These Chinese workers are just the same as their Western counterparts: they love their families and hope to change their lives through hard work. They consider it their life purpose to improve the quality of life of their families, especially their children. The U.K. outlet ultimately concluded that the unyielding spirit of Chinese people is unrivalled, and they will certainly change the world.

Hard work pays. This is the basis for social function. Any society will collapse without such faith.

China is no longer the impoverished country it was 30 years ago. Even so, the enterprising spirit of its citizens has endured. The country needs to stay confident, especially during the “new normal” of slower economic growth. As long as its people have the faith to change fate through hard work, they should fear no difficulty.

One dare not say that the 21st century is destined to be the era of China, but it certainly belongs to the strivers who are determined to change their lives through work.

This article was edited and translated from 21世纪属于渴望奋斗改变命运的"泥腿子"
Source: People's Daily

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Wednesday, November 23, 2016

Why we fail at corporate governance with corrupt officials?

https://en.wikipedia.org/wiki/Sabah_State_Water_Department_corruption_probe

Malaysia still suffers from corporate scandal after another, says Musa

PETALING JAYA: Malaysia is great at formulating legislation for corporate governance but lacks the ability to implement and enforce these, said former deputy prime minister Tun Musa Hitam (pic).

“As far as I can remember, Malaysia is the leading developing country that currently occupies the top half of the list in formulating legislation, rules and regulations for corporate governance.

“But when it comes to implementation and enforcement, we occupy the lower half of the list,” said Musa, who is also World Islamic Economic Forum chairman. Delivering his keynote address at the Women’s Institute of Management’s Conference on Integrity and Corporate Governance, Musa said that in the past, government and corporate leaders were required to attend a course on corporate governance.

“It is quite obvious that these efforts are to no avail and the programme seems to have been scrapped.

“After all our training, Malaysia still suffers one corporate scandal after another,” he said.

The country’s weakness in corporate governance lay in its inability to enforce the rules and was the major cause of its many scandals, he said.

Musa said that good governance extended to areas relating to corruption, abuse of power, accountability, application of corporate social responsibility (CSR), transparency and protecting shareholder interest.

“If you ensure transparency and accountability in decision making, apply CSR and care about shareholder interest, then you are practising good corporate governance,” he said.

Good corporate governance, Musa pointed out, could only happen if all the laws were implemented without fear or favour.

“This is most crucial for good corporate governance and it is up to the chairman and board of directors to administer this,” added Musa.

Another important ingredient was leadership with integrity, he said.

“Leadership by example produces good governance and in my experience, if this is practised, even the most influential person can be persuaded to act in the broader interest of the corporation and shareholders.” By Jo Timbuong The Star

Corporate governance – a shared responsibility

TUN Musa Hitam was spot on when he said at a conference on Monday that a company’s directors and managers were practising good corporate governance when they ensured transparency and accountability in decision making, applied corporate social responsibility, and cared about the shareholders’ interests.

These are indeed essential ingredients if we want our companies to be run well.

And Musa was right in pointing out that good corporate governance could only happen if the laws were implemented without fear or favour.

This matters because corporate governance thrives in an environment in which the rules are clear and robust, and the regulators are firm and consistent.

However, corporate governance is not just about complying with the letter of the law. It is also about directing and controlling a company through practices, structures and processes.

Many of these elements are voluntary; a thin line separates government oversight and the straightjacketing of business with an overkill of statutory prescriptions.

For example, most experts on corporate governance agree that the roles of chief executive officer and chairman of the board ought to be separated so as to avoid concentrating a lot of decision-making power in one person.

And yet, it is perfectly legal in Malaysia for an individual to wear these two hats at the same time. It is the same in some developed countries.

It remains a hot topic, but it is clear that most regulators continue to be reluctant to outlaw this practice of combining CEO and chairman duties.

The biggest challenge is to persuade company stewards to embrace the principles of corporate governance without being prodded by the authorities and their volumes of laws.

For this to happen, the directors and managers have to be convinced that good corporate governance adds significant value to their companies.

There are many studies that have concluded exactly that, but these findings mean little if there is still the perception that most people do not care about corporate governance.

Let us look at the listed companies, whose value is measured constantly in the stock exchange as investors buy and sell the companies’ shares.

On paper, a company with a poor track record in corporate governance would have trouble getting attention in the stock market.

And yet, we have frequently seen such companies at the centre of feeding frenzies sparked by speculation that the share prices will soar for whatever reason. This is not a great advertisement for corporate governance.

Nor is it encouraging that shareholder activism in Malaysia is limp. Many of those who own small amounts of shares in a company are often indifferent to how the company is performing, preferring instead to focus on the share price.

And when they do turn up at the shareholder meetings, it is seldom to engage with the board and management and to ask tough business questions.

The regulators and company stewards alone cannot push the corporate governance agenda.

Investors and other stakeholders too must show that they appreciate the fruits of good corporate governance, instead of complaining bitterly only after companies have collapsed and huge investments have gone down the drain. The Star Says

A-G: GLCs should adopt best practices

Praise and encouragement: Ambrin speaking during the WIM Conference on Integrity and Governance at the One World Hotel in Petaling Jaya.

“In theory, the country’s best practices could be easily adopted wholly or in part by most GLCs. But in reality this is not always the case as you can see from our audit findings with regard to the business performance and corporate governance of these GLCs.

“If guidelines are not being adhered to or given exemptions, it may severely compromise the governance and expose the companies to risk of fraud and corruption,” he said in a keynote address at the Women’s Institute of Management (WIM) conference on integrity and governance yesterday.

The 2015 Auditor-General Report (Series 2) was released two days ago, in which issues like poor management of the Cooking Oil Stabilisation Scheme and weaknesses in the management of medicinal supplies at health clinics nationwide were highlighted.

On the issue of GLCs that were not doing well, Ambrin said these companies were supposed to contribute to wealth creation for the government and act as a trustee to the public.

“Instead, they might become a burden, asking for bailouts and additional grants or to convert their loans to equity so they can continue to exist as a going concern, but to whose benefit really, one might ask,” he said.

The Auditor-General also observed that based on his audit experience, there were times where a GLC’s board of directors had been conveniently bypassed on major decisions.

He added that companies should have at least some, if not all, the best practices required to ensure integrity and good governance in their organisation.

“For example, I am very impressed with Khazanah, they have a high standard of governance and are very professional, so to me they are a model GLC.

“Of course we don’t expect smaller companies to have the full-scale best practices that they have, but at least have some elements like a standard operating procedure, internal audit committee, and a good board of directors,” he said.

Former Law Minister Datuk Zaid Ibrahim said merely having policies for integrity and good governance in place were not enough.

“Malaysians need to talk about it and live it in order to move a step ahead,” said Zaid who was a panellist at the conference.

He said putting integrity into action may be challenging because of restrictive laws like the Official Secrets Act but that shouldn’t stop people from doing so.

Zaid said if Malaysians were committed to the principles of integrity and good governance, they needed to be courageous in their cause.

“You cannot defend integrity without courage but be prepared to pay a price for it. You might not get promoted, or get the title, or the contract you want but integrity needs to be cultivated, no matter the price,” he said.

Zaid also said the courage to fight for integrity must come from within and individuals cannot expect the higher-ups to lead the way.

“You must own it and start with yourself,” he said, adding that the more people embrace the idea of integrity, the higher the chance of creating a society driven by morals and truth.
- By LOSHANA K SHAGAR and JO TIMBUONG The Star

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Saturday, November 19, 2016

Bring corrupt culprits to court fast

MINISTER in the Prime Minister’s Department Datuk Paul Low recently told the Dewan Rakyat that the Malaysian Anti-Corruption Commission (MACC) detained 1,011 civil servants and 26 executives of government-linked companies (GLCs) for alleged corruption and money-laundering between 2014 and September this year.

Assets amounting to almost RM172mil were seized and frozen in relation to these cases.

The government officers nabbed outnumbered the GLC executives by nearly 40 to one, but that is no reason to focus less on the fight against corruption in the GLCs.

The GLCs are in many ways a special class of companies.

A GLC is like any other company in the sense that its primary objective is to make money from commercial activities.

At the same time, a GLC is controlled by the Government (usually through majority shareholding) and is thus an extension of the Government.

But that is not the only way that a GLC is like a government department or a statutory body.

Often, GLCs serve as instruments of public policy.

For example, they undertake huge projects that drive the country’s development. They are in industries that are strategic to national interests — aviation, finance, telecommunications, natural resources, automotive, ports and power.

They tailor certain aspects of their operations, such as human resources and procurement, to suit objectives set by the Government. And they champion causes that support what the authorities want to do.

As such, we have every reason to be dismayed if a GLC is not run with integrity and efficiency.

Do we derive comfort from the MACC’s detention of two GLC top men over the past week?

On Nov 10, the Commission picked up the general manager of a GLC at his house in Seremban to assist in a corruption probe.

And on Monday, a director of a GLC was detained for alleged abuse of power and corruption back when he was chief executive officer of another GLC.

We can view these developments as encouraging signs of the MACC stepping up its efforts to combat corruption in GLCs.

But the feel-good factor will not last if the investigations are not followed by swift and successful prosecution.

Hauling up people for questioning and freezing assets is only half the job.

The culprits must be brought to court and people need to see justice delivered without fear or favour.

If this does not happen, it only serves to bolster the longstanding argument that government has no business being in business.

By The Star Says - The Star analyses the issues and developments of the day, and offers a viewpoint.

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It pays to learn from China

Malaysia can achieve high income nation through Belt and Road initiative, says minister

https://youtu.be/IjEEOkPW8Zc

MALACCA: Malaysia can learn from China which is skilled in attracting and profiting from the knowledge and skills of its human capital, said Datuk Seri Dr Wee Ka Siong.

The Minister in the Prime Minister’s Department said China was creating an innovative economy and not just a high-income one driven by strong domestic consumption.

“China’s leadership is building on ambitious growth targets based on equality, efficiency and evaluation. We need to emulate this trait,” he said. Dr Wee was speaking at the opening ceremony of the 8th World Chinese Economic Summit (WCES)

WCES is organised by the Asian Strategy and Leadership Institute (Asli) with the aim of promoting global and regional dialogue on the emergence of China as the world’s largest economy and bringing together the global Chinese diaspora.

Dr Wee said that Malaysia, through its participation in China’s Belt and Road initiative, would be able to achieve its aim of becoming a high-income economy by 2020.

Movers and shakers: Dr Wee (centre) flanked by former Taiwan President Ma Ying-jeou (Wee’s right) and WCES founder and patron and Country Heights Group of Companies founder Tan Sri Lee Kim Yew cutting ribbons at the opening ceremony of the 8th WCES in Malacca. Also joining them are (from left) WCES co-chairmain Datuk Seri David Yeat, Asli CEO Tan Sri Michael Yeoh, Asli and Sunway Group chairman Tan Sri Jeffrey Cheah, Plantation Industries and Commodities Minister Datuk Seri Mah Siew Keong, former Indonesian President Susilo Bambang Yudhoyono, Malacca Chief Minister Datuk Seri Idris Haron, former Australian Prime Minister Kevin Rudd, former Pakistani Prime Minister Shaukat Aziz, former Thai Deputy Prime Minister Dr Surakiart Sathirathai, Quest International University Perak chief operating officer Nicholas Goh, Mah Sing Group marketing and innovation general manager Lily Lee and Star Media Group Bhd editor-in-chief Datuk Leanne Goh.

“China can appeal to a variety of demographics within Malaysia. By utilising the diversity and skills of the multi-ethnic Malaysian workforce, China can further capitalise on business ventures in the region.

“This can include leveraging on the country’s Mandarin-speaking citizens in order to effortlessly conduct business, or using Malaysia’s large Muslim population to expand investment into the Middle East,” Dr Wee said.

One of the projects that came into the picture as an effect of Belt and Road was the Melaka Gateway that attracted an investment of RM43bil from China.

China’s southern province of Guangdong, which has established a friendly state and province relationship with Malacca, has expressed its interest in investing RM8bil in an energy project in the state that will create between 5,000 and 20,000 jobs for the locals, Dr Wee said.

On e-commerce, which currently contributes 16% to the GDP, he said that only 55% of local consumers use the Internet for shopping.

The appointment of Chinese Internet billionaire Jack Ma of Alibaba Group as the Government’s digital economy adviser will help tap the vast potential of that market.

The e-commerce market (excluding e-services) in Malaysia for this year was expected to reach US$991.1mil (RM4.3bil) in revenue, while the global e-commerce industry was projected to surpass US$3.5 trillion (RM15.3 trillion) within the next five years, said Dr Wee.

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